A man wearing masks, walks on street in Central, a business district in Hong Kong.
The lack of a proper legal framework for seeking bankruptcy protection, which has been deliberated on for a quarter century, means companies are forced into liquidation, according to Johnson Kong, the president of the Hong Kong Institute of Certified Public Accountants. In the US, for example, Chapter 11 protection helped the once troubled toy chain Toys ‘R’ Us come back.
The retail and food and beverage sectors are most vulnerable to liquidations, said Kong, who’s been involved in restructuring and insolvencies for more than 35 years. “Given the complexity and technicalities of the bill as well as the concerns expressed by various stakeholders in previous exercises, we will organise a fresh round of engagement with stakeholders on specific areas in the draft bill in the next few months,” the spokesman said.